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What I’ve learned and want you to know

Here is what I’ve learned about the Civic Center expansion—and it has convinced me that the proposed plan isn’t right for our community. I think that you deserve to know this too.

The Civic Center won’t cost less than $180 million, but it should.

Since there was no bidding procedure, but instead a selection process for a Construction Manager at Risk, the Civic Center won’t cost any less than $180 million, but it should.

There are no specifications, no detailed drawings of the proposed expansion—there is just a contractual agreement that allows the Contractor at Risk to be an integral part of the design process.

What incentive does the Construction Manager at Risk have to complete the expansion for less than the $180 million estimate? As a heavy contractor, if asked for the cost for a mile of road in some location, I’d obviously set a maximum amount.

Even if the proposed expansion is approved, $180 million price tag is excessive and would need to be controlled through the design.

It’s too expensive and we are borrowing to capacity, and beyond.

We had to do some fancy bookkeeping to prove to the bank that our city can afford the proposed, colossal expansion—we had to combine The Vision Fund and the Capital Improvement Project Fund (CIP Fund).

The city’s own Finance Officer was on KOTA as saying this was necessary to get financing: “Sumption says the accounts were combined in order to show lenders that the city has enough revenue to pay off any debt obligation that would be incurred from the expansion.”

The Vision Fund is funded by a half-cent sales tax and the CIP Fund is funded by another half-cent sales tax.

We will be fully committing the Vision Fund.

Making the bond payment for the proposed expansion will require all or the majority of the Vision fund for years.

In recent years, the Vision Fund has provided funding for many projects in our community that you will likely recognize (click here to see the full list):

Canyon Lake dam reconstruction

Airport terminal expansion

Horace Mann Pool

Youth & Family Services renovation

Main Street Square

Skyline Drive preservation

Public Safety Building

Library remodel and expansion

Highway 16 Fire Station #6

These are representative of the types of projects that will have to be put off, killed entirely, or have alternative funding identified while Civic Center expansion consumes all the Vision Funds.

We are gambling the CIP Fund.

By combining the Vision Fund and the CIP Fund as a mechanism to prove to bankers that we can afford the proposed expansion, we are putting the CIP Fund into the betting pot.

Projects funded by CIP Fund may not be as quickly identifiable as a new Fire Station on Highway 16, but they are still important and include vital maintenance and repairs (click here to see the 2011-2016 CIP Plan):

Sanitary sewer extensions

Utilities

Water reservoir maintenance

Street drainage reconstruction

We are being given an exaggerated cost estimate to address the ADA violations.

Proponents of the expansion have argued that it would cost at least $70 million (and sometimes even more) to remodel the arena for ADA.

The truth is that the estimated $35 million ADA cost is being combined with the estimated $35 million cost to update and upgrade the Barrett Arena.

Click here to see the actual estimated cost for ADA repairs on the Opinion of Probable Construction Cost document (yellow highlights were added by this blog). The document lists two estimates: the lower at $32,744,121 and the higher at $34,437,602.

Before “contingencies” are added, the lower estimate is barely over $23 million—and a closer look at the basis for the $23 million estimate reveals that even that number seems exaggerated.

An example: Some of the items—including one of the largest, Civil / Utilities (Allowance) at $500,000—list “LS,” for lump sum, as the “Unit”. This means that these items have been merely estimated. As a contractor, we always considered those to be SWAGS (super wild ass guesses).

$70 million includes more than just needed repairs—it includes improvements.

We are being told that it will cost $70 million for ADA, Life Safety, Fire Marshal, and Building Code purposes, but our $70 million would get us more than just the needed repairs.

Click here to look at the estimate and you will see that it also includes sound system upgrades, a kitchen remodel and expanded storage, stage equipment, sport flooring, and a stage and back stage addition.

The $70 million would get us an updated, refreshed arena, and with expanded storage and kitchen areas.

We are being given an exaggerated timeline.

We have also been told that remodeling the Barnett Arena may take five years and that we could lose—forever—events that would, supposedly, have to relocate. That is ridiculous.

Five years to complete the repairs listed in Attachment A of the settlement? No. Look for yourself.

We can phase the project, without shutting down the arena for five years.

We have been told that we will have to shut down the area for five years, but the report from TSP says that the project could be phased.

There is no reason why the parts of the construction process that might close the arena cannot be carried out in a carefully phased manner during periods that the arena is not in use or is least in demand.

We remodeled our airport without shutting it down for five years, surely we can find a way to make the required changes with minimal impact on events.

We will have insufficient parking, and won’t gain as many spaces as claimed.

Events in the bandshell will have free parking—except for Hills Alive.

All attendees of the Black Hills Stock Show and the Lakota Nations Invitational will also have to pay for parking. Again, look for your self on page 78 and 79 of what proponents of the expansion refer to as the Business Plan.

Some of those parking spaces will be reserved for VIPs.

The Business Plan calls for 250 club seats in the new arena (and that 90 percent are fold per year at $500 each—not including the cost of tickets) that would include VIP parking.

We have barely made a net gain in parking spaces, and now some of those are going to be reserved for club seating—not available to the general public.

Can Rapid City support two more sports teams?

The Business Plan assumes that the new arena will host two new minor-league franchises: a NBA D-League team and a football or soccer franchise, just look on page 66.

How many indoor football teams have we seen come and go in Rapid City? How can put ourselves in a position to rely on an indoor football team and a NBA D-League team to be successful for the proposed expansion to be financially viable?

We can vote no and still care about accessibility for people with disabilities.

Some are inferring that a vote against the proposed expansion is a vote against accessibility for people with disabilities—that is not the case. We can address the ADA violations without spending $180 million dollars on a new arena.

The challenges listed in the DOJ article include difficulty locating a parking spot, the first parking spot located not having the required accessible aisle, difficulty entering the building though the double doors at a side entrance, and entering the room where the banquet was taking place.

Yes! Let’s remove accessibility barriers at the Civic Center for Connie and Jim and others with disabilities. We should do that, we can do that, we will do that—and we can do it with a plan that we can also afford.

Notably, the DOJ article does not mention the arena at all. What is does state is that the Civic Center parking areas coming into compliance as one of the “hallmarks” of our settlement with them.

At no point did the DOJ tell us to build a new arena to address ADA violations.

We can vote no and still address the ADA violations.

The proposed plan isn’t our only hope to address ADA violations. We can address the ADA, Life Safety, Fire Marshal, and Building Code issues for $70 million—or likely less—and we could even expand on a scale that we can afford. We should be able to have that conversation.

There are too many unanswered questions.

What happens if the sales projections are not met?

What happens if a large emergency should come along while we have taxed our debt-paying capacity to the max?

What happens when we need another fire station? (Remember when a consultant recommended adding funding for two new fire stations be included as part of Civic Center funding package? Has the need for two fire stations disappeared, or is our ability to pay for them what is disappearing? Will we even be able to get a loan for fire stations when we have already borrowed to the max? How will we pay for them when our Vision Funds are committed for years to come?)

What other investments were considered, if any, that might better serve the citizens and tax payers of Rapid City?

How did we get to this point anyway—why do we have an enforcement agency breathing down our necks?

We want to ensure that our Civic Center—all of it, not just the arena—is accessible to people with disabilities. How did we get to the point where we have a clock ticking because of a settlement with the DOJ? You can go online and see the Mayor admitting that he initiated the telephone call to the US Attorney. Click here to see for yourself, the comments start 54:50 into the video and at 1:08 the Mayor again references his call to the DOJ local Civil Rights Office.

Rather than build consensus around a plan, our Mayor called an enforcement agency on us and now, with a deadline looming, we are being pressured to accept a plan that just happens to be waiting.

We are being pushed to approve the proposed plan because of ADA, but the you consider the plan the less it to do with ADA. We don’t have to be robbed of our opportunity to find a plan that fits our community’s needs and our city’s wallet. Let’s vote NO to a plan that it too big and costs too much. Then let’s pull together as a community and work together and build agreement around a plan that does fit our needs and that we can afford without committing all of our Vision Fund and gambling CIP Fund.

10 thoughts on “What I’ve learned and want you to know”

I agree with Michael Sanborn. I am glad to see you turn away from red herring about complaint vel non. The Civic Center, particularly the Barnett Arena, needs substantial upgrades to allow use for disabled people, and the approach taken in the past to this issue has been a shame if not a disgrace. But that can be addressed in a less ambitious project.

I like how there was no bidding contract let’s just give it all to J Scull Const. That’s real fair give the rest of the contractors in town a chance to bid on it
Trust me your not building with the best when you choose J Scull

It has been 3 years of development and effort on the part of very talented City staff and designers/developers. Three different consulting teams and AECom – the leading economic experts for a facility of this nature.

You got to love how the uninvolved mayors and you Stan, are experts…..

I don’t think Senator Adelstein is professing to be an expert at anything. He took the Civic Center’s own information and turned it all on its head. I’ve been asking for clarification on many of these points for months. And what have I gotten back? Rhetoric about how the civic center is being built for “diversity” for future events but with no plan in place to secure these events. If and when we procure a new sports franchise, they will want their logo on the court/field. Which means the floor and court that the AECom report currently has pictured will be a worthless expense. Nothing like wasting taxpayer dollars! And I’ve noticed something else about the proponents of this…anytime anyone hits a nerve and points out a hole in this albatross, they point fingers and call names, probably because they don’t have an answer.

I dont always agree with Stan but he is right on this time. He has done the research much as i have and we have came to the same decision. this whole civic expansion is poorly thought out and think about this, this is the same kind of creative financing practices that took Detroit to bankruptcy. I am not saying it will happen but the possibility is always there when you get carried away spending. lastly the money is the TAXPAYERS money not the govts. money and should be very carefully spent.
Cody Champion

as long as it keeps the construction owners rich who quote twice what it would cost and anyway no one really wants this town to grow anyway just a place where kids cant wait to leave and everyone else just waiting to die